Mining Inisghts – April 2024 – The Mining Future

This document consist of insights by The Mining Future’s Business Development Manager (Bash) on the current state of mining after the Bitcoin halving 2024.

Such ideas are intended to be high level information therefore can be deemed incomplete due to limited public information on mining operations, therefore it’s based on assumptions that need to be validated but it can serve as an indication of future trends.

Current Status:

1. Hashrate: miners are fortifying their operation by buying more miners into their fleet (With BTC consolidating around $65,000, Hashrate and difficulty continues to increase – see first picture above). Despite the difficulty increase and the halving impact (50% reduction in block subsidy), miners are still profitable, here is why:
2. Mining Revenue: at the time of the halving transaction fees spiked into 40 BTC/block and currently sitting between 2.5-4 BTC/block, here is why its happening and why I believe it will continue to increase (see in image below transaction fees per block).
   There are also many companies launching on top of Bitcoin to create DeFi, NFTs, etc… to name a few Babylon and BoB (Build On Bitcoin) companies are leading the way. There are many other companies generating interest from Venture Capitalists (VC) to invest in Bitcoin Companies.
3. Investments in Bitcoin Companies = more tokens and trade = more transactions = miners win!
   
4. Casey invented Inscriptions which resulted into a spike in interest in inscriptions in addition to BRC20 (equivalent version of Ethereum ERC20) which resulted into many tokens launched on Bitcoin, the real game changer was Runes, which was introduced on Bitcoin Halving and that created all the fee increase, I expect this trend will continue and even more interest will be generated in creating tokens on top of Bitcoin Runes, Inscriptions, Ordinals and BRC20 standard
5. BTC Price After Halving: If history repeats itself then it would be just perfect!
6. Difficulty Adjustment: as highlighted below, we continue an upward trend as more miners join the network and/or miners are upgrading their ASICs with new generation miners (such as S21) as they anticipate BTC price will be much higher at the end of 2024.

My Projections for 2024 (Linking everything together)  

A – Price: we retraced from 73k to 61k and normalized around 65k, its obvious to me all the leverage has been wiped out and we will continue to consolidate between 60-71k for the next few months as we build a new floor (support level) and in Q3/Q4 we will reach 80-100k

B – Miners: TMF client data indicate more interest in new generation miners and I’m seeing in the market big orders which is indicative of continuous strong demand 

C – BTC ETF: inflows have slowed a bit but there is still interest, more buying at least until the end of the yea

D – Transaction Fees: continuous demand to create and trade shitcoins, Runes in particular with its ability to connect other blockchains will attract more users

Final Thoughts:

The above are merely projections which can be correct and completely wrong, I will share my thoughts on mining and upgrades.

Mining: mining with a strategy of hodling (not selling any BTC) and will likely be strategy for many investors at least until the remainder of the year and possibly until mid 2025.

Upgrades: older ASIQs won’t be as efficient as the new generation ones especially after the halving if the strategy is to hodl then its wise to consider new generation miners.